VANCOUVER, Canada--(BUSINESS WIRE)--
lululemon athletica inc. (NASDAQ: LULU; TSX: LLL) today announced
financial results for the three and six months ended July 31, 2007.
For the three months ended July 31, 2007:
-- Net revenue increased 80% to $58.7 million compared to $32.5
million for the second quarter of fiscal 2006. Net revenue
from corporate-owned stores increased 98% to $53.1 million
compared to $26.8 million for the second quarter of fiscal
2006, with comparable store sales growth of 30%.
-- Gross profit as a percentage of net revenue increased 430
basis points to approximately 53% of net revenue from 49% of
net revenue in the second quarter of fiscal 2006.
-- Income from operations increased 202% to $9.8 million, or 17%
of revenues, compared to $3.2 million, or 10% of revenues, in
the second quarter of fiscal 2006.
-- Diluted earnings per share were $0.07 on net income of $5.1
million, compared to diluted earnings per share of $0.03 on
net income of $1.9 million in the second quarter of fiscal
2006.
For the six months ended July 31, 2007:
-- Net revenue increased 70% to $103.5 million compared to $60.7
million for the same period in fiscal 2006. Net revenue from
corporate-owned stores increased 86% to $91.1 million compared
to $49.0 million for the same period in fiscal 2006, with
comparable store sales growth of 25%.
-- Gross profit as a percentage of net revenue increased 210
basis points to approximately 52% of revenues from 50% of net
revenue in the first six months of fiscal 2006.
-- Income from operations increased 78% to $16.6 million, or 16%
of revenues, compared to $9.4 million, or 15% of revenues, in
the first six months of fiscal 2006.
-- Diluted earnings per share were $0.12 on net income of $8.7
million, compared to diluted earnings per share of $0.07 on
net income of $5.1 million, for the same period in fiscal
2006.
Robert Meers, lululemon's CEO stated: "We are pleased to report
strong results in our initial quarter as a public company. Our team
has built on the success of our unique winning formula - vertically
retailing technical apparel for men and women - in a rapidly growing
global market for healthy and active living. All of our managers,
educators, brand ambassadors and head office employees continue to
pave the way for the company's success."
On August 2, 2007, the company completed an initial public
offering of 20,930,000 shares of common stock at a price of $18.00 per
share, of which 2,290,909 shares were sold by the company and
18,639,091 shares were sold by certain selling stockholders. Upon
completion of the offering, the company and the selling stockholders
received net proceeds of approximately $31.8 million and $312.0
million, respectively. The company intends to use the net proceeds
from the offering, together with cash flow from operations, to fund
new store openings and working capital, and for other general
corporate purposes, which may include general and administrative
expenses and potential acquisitions of franchises.
Mr. Meers continued, "We are very pleased with the successful
completion of our initial public offering, and looking ahead, we are
excited about the prospects for our unique brand and retailing model.
Our plan is to capitalize on our expansion opportunities, and we are
committed to generating returns for our stockholders."
Guidance
For fiscal 2007, lululemon plans to open 25 new stores in North
America, including the 8 new stores opened in the first two quarters.
The Company is on plan to open the remaining 17 stores in the second
half of fiscal 2007 and continues to expect 30 to 35 new store
openings in fiscal 2008.
Based on results in the first half, the Company expects diluted
EPS of $0.30 to $0.33 in fiscal year 2007 including $0.05 to $0.06 in
our third quarter. We also expect comparable store sales in the mid to
high-teen range for the full year. We anticipate diluted weighted
average shares outstanding of approximately 70.0 million for 2007. The
Company's long-term annual financial targets include comparable store
sales growth in the high-single digit range, net revenue growth of
approximately 25% and diluted EPS growth in excess of 25%.
Conference Call Information
A conference call to discuss second quarter results is scheduled
for today, September 10, 2007, at 4:30 PM Eastern Time. Investors
interested in participating in the call are invited to dial (877)
502-9272 approximately ten minutes prior to the start of the call.
Analysts participating in the call are invited to dial (877) 502-9276.
The conference call will also be webcast live at www.lululemon.com.
About lululemon athletica inc.
lululemon athletica (NASDAQ:LULU; TSX:LLL) is a yoga-inspired
athletic apparel company that creates components for people to live
longer, healthier and more fun lives. By producing products that keep
people active and stress free, lululemon believes that the world will
be a better place. Setting the bar in technical fabrics and functional
designs, lululemon works with yogis and athletes in local communities
for continuous research and product feedback. For more information,
visit www.lululemon.com.
Forward-Looking Statements:
This press release contains "forward-looking statements" within
the meaning of Section 27A of the Securities Act of 1933 and Section
21E of the Securities Exchange Act of 1934 that involve risks,
uncertainties and assumptions, such as statements regarding our future
financial condition or results of operations, our prospects and
strategies for future growth, the development and introduction of new
products, and the implementation of our marketing and branding
strategies. In many cases, you can identify forward-looking statements
by terms such as "may," "will," "should," "expects," "plans,"
"anticipates," "believes," "intends," "estimates," "predicts,"
"potential" or the negative of these terms or other comparable
terminology. These forward-looking statements are based on
management's current expectations but they involve a number of risks
and uncertainties. Actual results and the timing of events could
differ materially from those anticipated in the forward-looking
statements as a result of risks and uncertainties, which include,
without limitation: the possibility that we may not be able to manage
operations at our current size or manage growth effectively; the
possibility that we may not be able to locate suitable locations to
open new stores or attract customers to our stores; the possibility
that we may not be able to successfully expand in the United States
and other new markets; the possibility that we may not be able to
finance our growth and maintain sufficient levels of cash flow;
increased competition causing us to reduce the prices of our products
or to increase significantly our marketing efforts in order to avoid
losing market share; the possibility that we may not be able to
effectively market and maintain a positive brand image; the
possibility that we may not be able to maintain recent levels of
comparable store sales or average sales per square foot; the
possibility that we may not be able to continually innovate and
provide our consumers with improved products; and the possibility that
our suppliers or manufacturers may not produce or deliver our products
in a timely or cost-effective manner; and other risk factors detailed
in our filings with the Securities and Exchange Commission ("the
SEC"), including Risk Factors contained in our final prospectus
relating to our initial public offering filed included in our
Registration Statement on Form S-1 (file no. 333-142477) filed with
the Securities and Exchange Commission and available at www.sec.gov.
You are urged to consider these factors carefully in evaluating the
forward-looking statements herein and are cautioned not to place undue
reliance on such forward-looking statements, which are qualified in
their entirety by this cautionary statement. The forward-looking
statements made herein speak only as of the date of this press release
and the company undertakes no obligation to publicly update such
forward-looking statements to reflect subsequent events or
circumstances.
Exhibit (1)
lululemon athletica inc.
Consolidated Statements of Operations (unaudited)
Expressed in thousands of dollars except per share amounts
Three Months Three Months Six Months Six Months
Ended Ended Ended Ended
July 31, July 31, July 31, July 31,
2007 2006 2007 2006
Net revenue $58,681 $32,517 $103,470 $60,701
Costs of goods sold
(including stock
based compensation of
$193, $70, $2,487 and
$1,543) 27,434 16,614 49,412 30,278
------------ ------------ ---------- ----------
Gross Profit 31,247 15,903 54,058 30,423
As a percent of
revenues 53.2% 48.9% 52.2% 50.1%
Selling, general and
administrative
expenses (including
stock based
compensation of
$1,368, $720, $2,606
and $982) 21,477 12,667 37,440 21,073
As a percent of
revenues 36.6% 39.0% 36.2% 34.7%
------------ ------------ ---------- ----------
Income from operations 9,770 3,236 16,618 9,350
As a percent of
revenues 16.6% 10.0% 16.1% 15.4%
Other expense
(income), net (70) (22) (177) (44)
------------ ------------ ---------- ----------
Income before income
taxes 9,840 3,258 16,795 9,394
Provision for income
taxes 4,798 1,318 8,247 4,273
Non-controlling
interest (80) - (116) -
------------ ------------ ---------- ----------
Net income $5,122 $1,940 $8,664 $5,121
Earnings per share:
Basic $0.08 $0.03 $0.13 $0.08
Diluted $0.07 $0.03 $0.12 $0.07
Weighted average
outstanding:
Basic 65,225,819 65,225,819 65,225,819 65,225,819
Diluted 68,891,237 68,881,241 68,878,832 68,868,836
Exhibit (2)
lululemon athletica inc.
Condensed Consolidated Balance Sheets
Expressed in thousands of dollars
July 31, 2007 January 31, 2007
--------------------------------------- ------------- ----------------
(unaudited)
ASSETS
Current assets
Cash and cash equivalents $9,727 $16,029
Inventories 23,848 26,628
Other current assets 4,704 5,836
------------- ----------------
Total current assets 38,279 48,493
Property and equipment, net 27,215 17,737
Intangible assets, net 7,205 2,140
Other assets 10,799 3,923
------------- ----------------
Total assets $83,498 $72,293
============= ================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable $4,928 $4,933
Other current liabilities 14,837 17,173
Income taxes payable 5,370 9,178
------------- ----------------
Total current liabilities 25,135 31,284
Other liabilities 5,897 3,630
Stockholders' equity 52,466 37,379
------------- ----------------
Total liabilities and stockholders'
equity $83,498 $72,293
============= ================
Source: lululemon athletica inc.